It’s the start of a new semester and the newest freshman at the University of the Pacific in Stockton, CA is Pepsi’s new Snackbot. Developed in partnership with Robby Technologies, these self-driving robots will make snacks and beverages available to college students (and presumably staff!). Pepsi envisions this new channel of distribution as a way of capitalizing on changes in student dining as packed schedules push students to quick, on-the-go options. You can read more about this new project in Pepsi’s press release.
Amazon Reports Increased Streaming of NFL Games
MediaPost recently published this article reporting that Amazon’s viewership of live-streamed Thursday night NFL games is up 22% to 14.7M viewers so far this season. For reference, this averages to ~2M streamers per game as compared to ~13M TV viewers per game. These streams are differentiated from traditional TV broadcast by offering alternate audio commentary from an all-female duo. Amazon is streaming these games on their Twitch platform which is primarily used for eSports streaming. Amazon has already signed a deal with the NFL for streaming rights for the 2019 season. This should represent a win-win for the NFL and Amazon. For the NFL, this helps them stay relevant in an increasingly mobile viewing world and adding these viewers should help Amazon strengthen their Twitch platform and provides additional opportunity for new advertising revenue.
Sports marketing tends to be inherently popular with students but it might be worth talking about how this illustrates distribution channel strategy. While we often think about the channel in terms of retailers, wholesalers, and warehousing, channel decisions apply just as much to digital services as they do to physical goods.
Cannabis Coca-Cola
Coca-Cola is looking at getting into the cannabis-infused drink business. You won’t be able to get high off the drink since it uses a non-psychoactive component (CBD) in marijuana. Nevertheless, the story is garnering a lot of media attention and Coca-Cola says the industry has significant potential. You can read more about the story here.
Ask your students to put together a marketing strategy for the new Coke drink. Who do they define as the target market? Why? Students often see themselves as the largest market segment for products that they like and this can be a good opportunity to push them to think more broadly. Beyond the target market, what would their marketing mix look like? How would they treat the cannabis component? Would they downplay it or make it front and center? Why? Would they have to implement new logistical processes or distribution channels? There are many different directions you could take this discussion.
Target Stores Reinvention Pays Off
Brick-and-mortar retailers like Target, Wal-Mart, and Best Buy have been struggling to find ways to stay relevant in the new Amazon age. After trying to make incremental changes to stem losses, these retail giants are now realizing they have to make fundamental changes to their marketing and business strategies if they want to survive. CNN Money recently reviewed Target’s efforts, and results, in this article. After disappointing holiday sales in 2016, Target allocated $7 billion to modify their marketing mix. The article outlines changes made in every one of the 4 P’s and is a great example of how marketers need to consider all aspects of their marketing mix to create an effective marketing strategy.
The Exaggerated Death of Retail
Amazon is a retail juggernaut. Last year the company was responsible for 5% of total US retail sales (online and offline). Their growth and expansion seems unstoppable at the same time that we see other iconic retailers (Sears, JC Penney, Radio Shack, Payless Shoes, etc.) struggling to stay alive. Given the convenience and potential for cost savings it’s easy to say that the future of retail is online and brick-and-mortar establishments are a thing of the past but this FastCompany article,”The Future Of Retail In The Age Of Amazon“, offers a different perspective. Fair warning – this is a fairly lengthy article but it provides a number of good discussion topics.
The article starts by discussing the decline in traditional malls but talks about investments being made by the Mall of America to attract younger buyers. While online shopping has certainly contributed to traditional store closures, the article also claims over-expansion and lack of investment are significant contributors to decline as well. Even with all of the well publicized store closings there was still a net increase of 4000 stores in 2017 and a higher increase expected this year. The article spotlights Target and talks about some of the investments they’re making to move back to partnered custom products and emphasize visual merchandising in their store design. Much of the article alludes to the idea that a focus on the shopping experience can provide a unique value proposition that allows traditional retail to differentiate itself from online retail.
Students do a surprising amount of traditional retail shopping and you can get some good discussions started when asking them to articulate why they choose to buy in-store as opposed to buying online.